Singapore's central bank pulled back its full-year inflation outlook on Friday, as July figures fell below expectations to a three-year low.

Less than a fortnight after Monetary Authority of Singapore (MAS) chief economist Edward Robinson reiterated a core inflation forecast of 1 per cent to 2 per cent, his team's view has now moved from "near the mid-point" to the lower half of the range.

MAS core inflation, which excludes private transport and housing costs, slipped to 0.8 per cent in July, its weakest showing since April 2016, down from 1.2 per cent in June.

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Meanwhile, all-items inflation cooled for a second consecutive month to 0.4 per cent in July, from 0.6 per cent in June. Headline inflation is expected to range from 0.5 per cent to 1.5 per cent for the full year, following a forecast downgrade in February.

HSBC economist Liu Yun observed in a report: "The main drag came from declining energy prices, which made negative contributions to the core for the first time since 2017."

The MAS and Ministry of Trade and Industry (MTI) had noted in February that a downturn in oil prices was weighing on inflation expectations - and energy costs remain muted.

The cost of electricity and gas fell by 7 per cent year on year in July, widening from a 4.8 per cent drop in the month before. National liberalisation of the electricity market has been flagged as one culprit for the depression since its roll-out last November.

Still, United Overseas Bank economist Barnabas Gan noted that the fading inflation pressures "come in tandem with the slowdown in Singapore's economic fundamentals".

Official forecasters cut the full-year gross domestic product (GDP) outlook for the second consecutive quarter on Aug 13 to between zero growth and 1 per cent; the forecast for exports was slashed to a decline of between 8 per cent and 9 per cent.

Now, the MAS and MTI have again said that "external sources of inflation are likely to be benign" and "acceleration in inflationary pressures is unlikely" on factors such as slower GDP growth and global uncertainty.

Worse yet, private-sector analysts warned on Friday of further risks to inflation: Citi's Kit Wei Zheng and Ang Kai Wei flagged a wider slowdown in consumption; Maybank Kim Eng's Chua Hak Bin and Lee Ju Ye suggested that the prices of made-in-China goods would weaken on the back of a weakening yuan and the US-China trade war.

Generally, private-sector economists now expect a half-point easing of the Singdollar slope at the next MAS policy meeting in October - but have not ruled out a return to the zero bias stance that prevailed for six years until some tightening in April last year.